The federal Mental Health Parity Act (MHPA) became effective January 1, 1998, with health plans given until April 1, 1998, to comply with its requirements. Many insurers have reported difficulty in complying with both the state mental health and AODA services mandate and federal mental health parity act requirements.

Under MHPA, insurance plans that cover mental health services are not permitted to establish dollar-based annual or lifetime maximums for mental health services that are different than for other covered medical services. Limits on the number of visits or treatment days are permitted. Only mental health services are affected; AODA services are specifically exempted from MHPA. State law (s. 632.89, Wis. Stat.) requires all group or blanket disability insurance plans to cover a minimum of $7,000 (subject to 10% coinsurance) in mental health and AODA services annually. Only HMOs are permitted to substitute an actuarial value of the MH/AODA benefit in visits or days. This bulletin addresses the apparent conflict between state minimums, required to be expressed in dollars, and federal law, prohibiting dollar limits on mental health services.

Based on our discussions with the federal Health Care Financing Administration (HCFA), OCI has determined that policies that outline the minimum mental health benefit, stated in dollars, in accordance with Wisconsin law and that have any maximum benefit in the policy stated according to federal law would meet the requirements of both agencies. Policy forms, except for HMO forms, must express the minimum coverage required by the State mandate in dollars. Any HMO policy forms submitted to OCI that limit mental health benefits to days or visits must include an actuarial certification documenting that the required state minimum benefit, expressed in dollars, is available to policyholders.